Evaluation of Effectiveness of Product Placement in Movies and Online Games - Research Paper Example

Product placement and effectiveness of product placement in movies and online games Contents Contents 1 Introduction 2 Discussion 2 Product placement 2 Product Placement Market 6 Effectiveness of Product placement 6 Conclusion 9 References 10 Introduction Product placement or embedded marketing is any kind of communication made to the public through audio visual which consists of reference to a product or service. There is severe audience fragmentation in the traditional media outlets. It has led the advertisers and the marketers to think about another tools and means of communication. Among the new forms of marketing communication approach, product placement is used frequently by them. Nowadays product placements are seen as an effective way to reach the target audiences. It has been used by the marketers for more than 50 years now. Nowadays product placement has been expanded and included into program TV programme. It has also been included in an array of different media like video games, novels etc. Moreover the role of the product placement has been shifted from being a background prop to now being an important part of a movie. There are many films like Castaways in 2002 where Tom Hanks who was a FedEx employee was left to drift alone after a plane accident with many FedEx packages. It helped him survive on the deserted island alone. Similarly there are many instances in games like Burnout Paradise where political ads of Obama were shown. This shows that product placement is an important strategy for the marketers in the present time. This report will take a look at the effectiveness of product placement in the movies and games. Discussion Product placement Product placement is defined as the paid inclusion of a branded products or brand identifiers within a mass media program through visual or audio means. This kind of strategy is adapted by the marketers to increase the brand familiarity and sales of the brand. It helps to capture more eyeballs for the marketer. Basically it increases the product presence among the customers more than ever before1. There are many advantages to product placements. These include overcoming the problem of zapping. Zapping occurs which when people switches between the channels. Because of product placement people are unlikely to engage in zapping because the brand appears in their favourite movie or video games which they can’t change. Hence they watch the product while watching the movie. In addition to this in such films the product is endorsed by a celebrity which h appears to have significant influence on the attitudes of the consumer towards the product. Further through product placement the advertisers are able to target very specific audiences since the demographics of those who attend the kind of movie can well be understood at prior. Product placement can have a longer lifespan than usual commercials. Whenever a movie or a video game is released on a DVD or in TV, the product placement is present in it. According to a research it was seen that audience s like product placement since it improves the realism of a movie or a video game2. There are three types of product placements. Barter arrangement, paid placement and gratis arrangement. They are distinguished on the basis of financial compensation. In Barter arrangement the product serves as the compensation for the brand placement. Examples of such kind of product placement are found in the film The Terminal. In the movie, United Airlines played a supporting role in the movie. The airline company used the movie to make their brand known across the people and give advice on how to make the airport unfirms and announcements more realistic. This helped the filmmakers save the production costs. In Paid placement, the integration of the product is arranged in advance by the marketers and then financial compensation is provided to them3. Here the prices can vary according to the nature and prominence of the product’s placement in the movie. Some examples of this kind of product placement are inclusion of Ray-Ban sunglasses in the movie Top Gun and Reese’s chocolate in the movie E.T. Gratis arrangements refers to product placement which increases the level of credibility or strengthen the character images. Such kind of gratis arrangement is found in the use of Raid brand of Johnson Company in the HBO series The Sopranos. Among the three types of product placements, the share of paid placements increased from 18 % to 29.4 % in the period 1974 to 2004. During the same period the share of gratis placements got reduced from 24 % to 7 %. During the same period, the share of barter arrangement increased from 58 % to 64 %4. The above data shows that the most frequent types of product placement is barter arrangement. In research on the effect of product placement on memory about the product, it has been seen that the memory of the product increased as compared with the same product when not placed in a movie or a video game. However early research shoed different results on the effectiveness of product placement on brand memory. It was seen that about 77 % of the movie viewers seem to recall Coke after watch the movie Falling Down (1993)5. At the same time only 18 % of the viewers seem to have recalled Hamm’s Beer in the movie Ong and Meri (1994). This variability in the findings shifted the attention to brain memory power of the audiences. It was seen products which are more visually prominent resulted in more memory power than for brands which has less prominent placements. There were many researches on the effect of plot placement on product payments. Russell (2002) tested this theory to find out its effect. He defined high plot placement and background placement. High plot placement refers to product placement in the movie at a time when the story line plays a major role in the movie or it develops the persona of a character. In contrast the background placement is known as low plot placement where the product is shown in times which do not offer significant moments in the movie. According to Russell, recognition rate of products of high plot placement was higher as compare to products with low plot visual product placement. Product Placement Market Product placement market has been in existence for more than 100 years. Their popularity has soared in the recent years. According to a recent article in Business Week the product placement has been a major marketing tool for the advertisers since 1998. According to PQ Media report the value of the product placements have grown at a compounded annual rate of 11%6. The market for product placement has been estimated at $ 3.6 billion. It has been projected to grow further in the years to come. Among all product categories, Placements of food and beverages, health and beauty, house and home account for more than half of total product placement in TV. Effectiveness of Product placement With increase importance of product placements by the advertisers, many researchers have been conducted on the effectiveness of product placements. Many results of the effectiveness of the product placement were mixed at first. The most common measures of product placement effectiveness are free and aided recall. Several studies were done in this respect by Babin and Carder (1995), Karrh (1995) and Nelson (2002). It was seen that people generally recognise products placed in movies7. It was seen that the product placements don not have any effect on the consumer attitudes towards the brands. According to a research by Mizerski’s and Vollmers (1994) it was seen that product placement does affect brand recall but have no influence over brand evaluation. It was conclude that the results were due to failure in considering the multi-dimensional nature of product placements. According to Lord and Gupta (1998) there are different levels of mode and prominence while evaluating the effectiveness of product placements with respect to audience recall8. As discussed previously it was seen that audience recall was highest during prominent placements. It was followed by traditional advertising and subtle placements. Further research was conducted by Babin, Brennan and Dubas (1999) on the impact of these different placements on the brand recognition. As discussed before, the placements which were integral to the storyline are being remembered by the audience more than others. On the other hand the exposure time did not have any effect on the brand recognition in case of background placements. But the same exposure was relevant when the product placement was central to the story. Seguin and D’ Astous (1999) conducted research on the effects of placement type, sponsor program congruity, sponsor image, ethical reactions and program genre to the product placements. It was seen that high congruity lead to better ethical judgements and evaluations as compared to lower congruity. Again the sponsor image had no impact in the ethical judgements and consumer’s evaluation. Chartier and d’Astous (2000) found that consumer memory is enhanced when the main actor is present in the scene. In such circumstances the product placement is positively evaluated. It is seen that consumer evaluations are more positive when the product placement is visible to the audience and it is well integrated within a movie scene9. Nelson (2002) did a research on the effectiveness of the product placements in racing games. It measured the effect of brands in video games directly after the game-play and after the period of five-months. It was seen that consumers could recall around 25 % of the brands featured in the video games over a short period of time as compared to 10 % after a five-month delay. Hence product recall was seen to enhance when the product played a significant role in the game and it was relevant to the user. Previous studies have investigated the impact of product placements on consumer purchases. According to Crawford and Baker (1995) the consumers exhibits higher level of short term purchase for products which are embedded in the movie. This result was further supported by Grabner, Gould AND Gupta (2000) which stated that the product placements have positive influence on the purchase intentions. Friedman and Morton (2002) did an analysis of the product placements in the movie. He explored the relationship between the product placements and audience beliefs. He founded that there is a correlation between the purchase intentions and consumer evaluations. Ethical beliefs didn’t have any affect the consumer behaviour much. According to Yaros, Nelson and Keum (2004) the attitude of the consumers towards purchase intentions were significantly affected by the product placements in games10. Conclusion It was seen that marketers and advertisers agencies have used the concept of product placements as a tool for marketing communication. According to the report there are many factors which could contribute to the effectiveness of the product placement. The most important measure of product effectiveness has been the consumer memory. This report also showed the effectiveness of the product placement on attitude of the consumers towards a target brand, their purchase intention. It was seen that the level of product involvement played an important role in establishing the effectiveness of a product under any circumstances like high or low plot connection and favourable or unfavourable prior brand evaluation. Hence it can be concluded that high plot connection will not influence the effectiveness of a product placement if the consumers have low product involvement. References Ahluwalia, R., Burnkrant, R. E. and Unnava, H. R. ‘Consumer Response to Negative Publicity: The Moderating Role of Commitment.’ Journal of Marketing Research, vol. 37, no. 2, 2000. pp. 203-211. Avery, R. J., and Ferraro, R. ‘Verisimilitude or Advertising? Brand Appearance on Prime-Time Television.’ The Journal of Consumer Affairs, vol. 34, no. 2, 2000. pp.217-244. Brennan, S., Rosenberger, P. J. and Hementera, V. ‘Product Placements in Movies: An Australian Consumer Perspective on Their Ethicality and Acceptability.’ Marketing Bulletin, vol. 15, no. 1, 2004. pp.1-11 d'Astous, A. and Chartier, F. ‘A study of Factors Affecting Consumer Evaluations and Memory of Product Placements in Movies.’ Journal of Current Issues and Research in Advertising, vol. 22, no. 2, 2000. pp. 31-40. Gould, S. J., Gupta, P. B. and Grabner-Kräuter, S. ‘Product Placement in Movies: A Cross-Cultural Analysis of Austrian, French, and American Consumers' Attitudes toward This Emerging International Promotional Medium.’ Journal of Advertising, vol. 29, no.4, 2000. pp. 41-58. Grigorovici, D. M. and Constantin, C. D. ‘Experiencing Interactive Advertising Beyond Rich Media: Impacts of Ad Type and Presence on Brand Effectiveness in 3D Gaming Immersive Virtual Environments’. Journal of Interactive Advertising, vol. 4, no. 3, 2004. pp. 321-334. Gupta, P. B. and Balasubramanian, S. K. ‘Viewers' Evaluations of Product Placements in Movies: Public Policy Issues and Managerial Implications.’ Journal of Current Issues and Research in Advertising, vol. 22, no. 2, 2000, pp. 41-52. Gupta, P. B. and Lord, K. R. ‘Product Placement in Movies: The Effect of Prominence and Mode on Audience Recall.’ Journal of Current Issues and Research in Advertising, vol. 20, no. 1, 1998. pp. 47-59. Karrh, J. A., Frith, K. T. and Callison, C. ‘Audience Attitudes towards Brand (Product) Placement: Singapore and the United States’, International Journal of Advertising, vol. 20, no. 1, 2001, pp. 3-12. Karrh, J. A., McKee, K. B. and Pardun, C.J. ‘Practitioners' Evolving Views on Product Placement Effectiveness.’ Journal of Advertising Research, vol. 43, no. 2, 2003, pp. 138-149. Read More